Demand Media and the Internet Commerce Association have called for ICANN to drop the “three strikes and you’re out” ban on applying for new top-level domains.

In the current version of ICANN’s Applicant Guidebook, if you’ve lost three UDRP cases in the last four years you’re considered a cybersquatter and effectively barred from applying for a new TLD.

It’s not entirely clear, but it is quite possible that this provision may capture Demand Media and Go Daddy, which, via subsidiary companies, have lost several UDRP complaints.

In comments filed with ICANN yesterday, Demand senior vice president Jeff Eckhaus said that a simple “three strikes” benchmark does not prove a pattern of cybersquatting:

losing a few contested UDRP cases in what amounts to a tiny percentage of their total domain name portfolio certainly doesn’t seem to constitute a “pattern” as most people would define the term

…

by all reasonable standards, it is difficult to conclude that an entity or an individual has engaged in a history/pattern of cybersquatting when they own hundreds or thousands of domain names and have lost a few UDRP or similar proceedings.

The ICA, which represents high-volume registrants, also has a problem with the rule. Principal Phil Corwin wrote ICANN:

We continue to believe that the “three strikes” criteria is too inflexible and that applicant evaluation criteria should take into account the total size of an applicant’s domain portfolio as well as the percentage of adverse UDRP decisions rendered against them in comparison to all UDRP proceedings they have been involved with.

Demand also argues that three strikes is “extremely broad standard that we believe will unintentionally disqualify otherwise qualified applicants.”

That strikes me as quite a weak argument, which could be equally applied to any of the background checks in the Guidebook. A murder conviction will also “disqualify otherwise qualified applicants”.

I’m not sure it’s “unintentional” in either case. If you work from the assumption that ICANN expects Demand and other speculators to successfully apply for new TLDs, it is. If you assume it’s designed to make their lives more difficult, it isn’t.

But Corwin noted in his comments that ICANN can waive the ban in “exceptional circumstances”, and said he suspects this could be used to allow large registrars to pass the background checks.

In any event, as Andrew Allemann has pointed out at Domain Name Wire, the way the Guidebook is phrased there may well be a loophole that would allow Demand and others to slip through.

Go Daddy, which DNW also reports could be affected by the rule, does not appear to have filed any comments on the latest Applicant Guidebook yet.

Comments (5)

The way I read the current wording is that it’s a big improvement on previous versions. There is a way by which an applicant can disclose UDRP cases etc., and then get past evaluation.. Or at least that’s how I read it